Wells Fargo is exiting the wealth management business outside the U.S. in a move designed primarily to simplify and focus on its core domestic business.
“Wells Fargo is focused on meeting our regulatory requirements, managing risk, and simplifying operations across the company,” Wells Fargo spokeswoman Shea Leordeanu told ThinkAdvisor on Thursday.
“For Wells Fargo Advisors, Wells Fargo Private Bank, and Abbot Downing, we are also committed to focusing on our core business, which is serving clients who primarily reside in the United States,” she said. Therefore, the wirehouse decided to exit the international segment of its business, she noted.
The international business segment represents just a small percentage of the firm’s accounts and assets under management across Wealth & Investment Management.
In its third-quarter financial report, Wells Fargo said it ended the period with 12,908 financial advisors, down 815, or 6%, from a year ago and 391, or 3%, from the prior quarter. The bank’s Wealth & Investment Management asset level was flat at $1.9 trillion.
“Because this segment requires different processes, approaches, and infrastructure maintenance, we have determined we will simplify the business,” Leordeanu explained. “We will also continue to service accounts for active duty U.S. military and U.S. government employees who may be stationed abroad.”
Wells Fargo acknowledges that this shift represents a “difficult change for our international-focused advisors, and this business will take many months to exit,” she explained. The bank intends to “work very directly with all affected advisors about their individual options.”
The firm will continue focusing on providing its clients with “excellent service during this transition and will proceed in a manner that is consistent with regulatory expectations,” the spokesperson added, noting: “We have a long process ahead of us.”